With the still burgeoning development of the Internet of Things (IoT), today’s tech experts are finding better ways to integrate smart devices into homes. Here in Australia, the industry is booming, as the smart home market is currently worth $1.2 billion a year, and Statista predicts that it could grow to $2.7 billion by 2022. In fact, you don’t even need to look that far into the future to see how big this sector is going to become.
But just how much would it cost to live in a modern smart home?
The answer to this depends entirely on how smart you want your home to be. Here on Smart City we have previously featured different devices that you can install in your home to make everything from lighting to area temperature more convenient to control. However, you don’t necessarily need to install everything on that list to make your home smarter. It’s ultimately a matter of personal preference, and smart home additions can cost anywhere from less than $100 to thousands of dollars, depending on what you need.
If you want to explore the cheaper end of the smart home devices spectrum, remember that you may already have a potential controller in your pocket – your smartphone. There are many smart devices that can be operated using your phone in lieu of expensive voice-activated smart home hubs. If you’re building a smart home on a budget, Gear Brain suggests focusing on cheap essentials, such as smart light bulbs and plugs. With a stable Wi-Fi connection, you can use your phone to access the smart features of these devices, as many of them are paired with apps. While this rudimentary smart setup offers simple benefits, it’s a step in the right direction.
If you want to step up your smart home game, it’s time to look beyond conveniences and dive into smart energy efficiency and home safety. While smart lighting offers more efficient use of home electricity, smart thermostats will allow you to save even more as you’ll have full climate control of the spaces in your home. Meanwhile, in terms of safety, there are smart cameras that can differentiate visitors from residents and smart locks that depend on biometrics and other advanced technologies to restrict access to your home. While these options could cost thousands of dollars, they could also decrease your home’s long-term energy costs, all while providing a safer and overall more customisable home environment.
There are also people who opt to buy a smart home from the get-go or build a brand new one, instead of simply transforming a traditional house into a smart home. What you have to remember in such instances is that the additional smart features increase the overall value of the house – but may also result in higher taxes and possibly even hidden charges. One notorious hidden charge in Australia is the mortgage registration fee that varies state-to-state, from $115 in Victoria up to $200 in Queensland. Buyers may also encounter conveyancing fees, which can reach as high as $2,000. This may be necessary, as doing legal work for owning a smart home can be daunting with all the technicalities involved.
It’s worth nothing that these hidden costs are not exclusive to Australia, as they exist in nearly every in-demand real estate market across the world. We also have stamp duty, which is implemented in the UK as well, where it can reach as much as 15% of properties valued over $2.6 million. With an added premium due to their features, smart homes in this price range are not uncommon. On the other side of the Atlantic in New York, Yoreevo’s resident real estate and finance expert James McGrath details the common closing costs for home buyers, and these include title insurance, mortgage recording tax, and attorney fees. The rates ultimately depend on the total value of the property. If you want to create and live in a truly smart home, you also need to be smart about anticipating the additional taxes and payments that come with these modern conveniences.
These levels of taxation shouldn’t come as a surprise, considering the above-mentioned current and potential value of the smart home industry. As a smart home developer, it’s important to see these devices and improvements not just as a new trend, but as the next step in the evolution of real estate. As long as this industry continues on its current path, the world’s most creative engineers will continue to find more efficient ways to make our lives more convenient, greener, and streamlined through home-based connected technologies.
Phil Healey blogs about real estate to complement his day job as an appliance salesman. He specialises in helping homeowners turn regular houses into energy-efficient and pet-friendly smart homes. When he’s not writing, he’s looking after his three children and the family’s Golden Retriever, Bob.